Christian Democrat Union, Greens and Free Democrats had been in talks
Parties were already way past initial deadline set after September vote
Christian Social Union want refugee cap while Greens want coal crackdown
But the FDP walked out of talks overnight, plunging Germany into crisis

Angela Merkel's future is in jeopardy after the collapse of talks to form a new government.

A poll by the Die Welt newspaper found 61.4 percent saying the failure of talks would mean an end to Merkel as chancellor.

Only 31.5 percent thought otherwise.

The woman who has led the economic powerhouse of Europe for 12 years has little time on her side to form an administration after the negotiations on Sunday ended in failure.

Germany could be facing a snap election in the new year after the pro-business liberal Free Democratic Party walked out on the meeting with Merkel's Christian Democratic Union and The Green Party.

Germany could be facing a snap election as Angela Merkel's Conservative union failed to form a coalition with another two parties, clashing on migration and climate change

The collapse of talks has thrown Merkel's future into doubt and a poll in one German newspaper found 61.4 percent saying the failure of talks would mean an end to Merkel as chancellor

The collapse of talks has thrown Merkel's future into doubt and a poll in one German newspaper found 61.4 percent saying the failure of talks would mean an end to Merkel as chancellor

FDP leader Christian Lindner said there was no 'basis of trust' to forge a government, adding: 'It is better not to govern than to govern badly. The parties do not share a common vision on modernizing Germany.'

News magazine Der Spiegel called the breakdown in negotiations a 'catastrophe' for Merkel and said Germany was having its 'Brexit moment, its Trump moment'.

Top-selling newspaper Bild said a failure to forge a coalition put 'her chancellorship in danger'.

Eight weeks ago Merkel's CDU conservatives emerged as the winner of the general election - but only just.

Her former partners in power, the centre left SPD, said it would not form a new administration with her. That left her seeking to build a coalition with the Green Party and the FDP.

But on Sunday night this so called 'Jamaica coalition' - named after the party colours which feature on the flag of the Caribbean nation - seemed doomed after the FDP walked out on the negotiations after weeks of wrangling.

Merkel may attempt to woo the centre left SPD party back but it is unlikely to acquiesce, seeing its role now in opposition to her.

The party's general secretary, Hubertus Heil, said Monday that the party's position 'is known' and said party leaders will now consider how to proceed.

He didn't elaborate ahead of a planned appearance by party leader Martin Schulz Monday afternoon.

One main sticking point in the negotiations was immigration. Merkel's decision to allow unlimited access to Germany by refugees fleeing war and terror helped slash her party's majority and propel the far right Alternative for Germany (AfD) into parliament.

The CDU, and it's sister party in Bavaria the CSU, agreed on a cap of around 200,000 a year.

But The Greens reject such a limit and are pushing for a resumption of family reunions for those who have been granted temporary refuge in Germany - meaning tens of thousands more asylum seekers would arrive annually.

They also reject a demand from the other parties to declare the North African nations of Algeria, Morocco and Tunisia 'safe countries of origin', and effectively stop all asylum applications from them.

The Greens also want more coal power plants shut down and more money invested in renewable energy along with a commitment to entirely phase out internal combustion cars altogether.

There are divisions too about the EU, financing it and reforming it. The FDP opposes any measures that would lead to the pooling of debt or the transfer of German cash to other troubled economies, like Greece or Italy.

The FDP also wants to end the 'temporary' Solidarity Tax brought in after the collapse of the Iron Curtain to build up decrepit East Germany which is still being gathered. The Greens want to keep it.

With such sticking points observers believe Merkel has little choice but to go to the polls again.

German Chancellor Angela Merkel has failed to reach an agreement with the Free Democrat Party and the German Greens. Her Christian Democrat Union alliance with the Christian Social Union is trying to reach out to the other two parties to make a four-party coalition. She is pictured with Volker Kauder, leader of CDU/CSU faction

Mrs Merkel is pictured arriving at talks with the Free Democrat and Green Party in Berlin yesterday

SPD vice-president Ralf Stegner made it clear via Twitter: 'The situation for the SPD will not change as a result of the collapse of the coalition talks.' And she has vowed not to do any deals with the AfD.

A possible coalition between the CDU, with Bavarian sister party the Christian Social Union, and the FDP would lack 29 seats for a majority in parliament, and a coalition between the CDU/CSU and the Greens would lack 42 seats.

Merkel will meet President Frank-Walter Steinmeier later today to brief him on the negotiations and discuss what comes next.

Meanwhile, Germany's main business group is calling on the country's mainstream political parties to show responsibility and make compromises after the failure of coalition talks.

The head of the Federation of German Industries, or BDI, said Monday that 'economic stability needs political stability.'

Chairman of the Free Democrat Party Christian Lindner (pictured) is concerned what Green Party plans to end coal use would do the country's economy. He also wants a cap on the number of refugees allowed into Germany

Chairman of the Free Democrat Party Christian Lindner (pictured) is concerned what Green Party plans to end coal use would do the country's economy. He also wants a cap on the number of refugees allowed into Germany

Dieter Kempf said that German industry faces 'enormous challenges' despite the country's good current economic situation.

European leaders have reacted to the news of the collapsed talks.

French President Emmanuel Macron has expressed concerns about the collapse of negotiations to form a coalition government led by Chancellor Angela Merkel in Germany.

Speaking in Paris on Monday, Macron said 'it's not in our interest for it to get tense.'

Macron said he had spoken to Merkel Sunday night and believed that the declarations of pro-business FDP President Christian Lindner 'were quite hard.'

The Netherlands' foreign minister says new elections in Germany, the European Union's most populous member, would be 'the worst scenario.'

Dutch Foreign Minister Halbe Zijlstra said in Brussels Monday that 'Germany is a very important country in Europe and thus it will become difficult to take important decisions in Brussels.'

Zijlstra noted that it took the Netherlands seven months to form a new government after an election earlier this year. Coalition talks in Germany collapsed on Sunday night, nearly two months after elections.

Zijlstra said: 'So I'd say, think about it again, and maybe it is better to talk again than to have elections again.

Germany faces a long period of uncertainty after talks on forming a new government broke down late on Sunday night. Angela Merkel, chancellor, was trying to form a coalition between her conservative bloc, the liberal Free Democratic party and the environmental Greens.

But the parties were deeply divided over issues ranging from how to tackle climate change to refugee policy. After exploratory talks dragged on for more than a month the FDP quit, saying the sides had failed to overcome their differences. What happens now? Frank-Walter Steinmeier, the German president, will play a crucial role and will meet Ms Merkel later on Monday. Under the constitution, the head of state is the person who ultimately decides whether Germany should hold new elections, which may be the only option available.

And if neither of those scenarios is possible or palatable, Germany could be heading for fresh elections. How likely is a ‘grand coalition’?A grand coalition would easily command a parliamentary majority, even after both the SPD and the CDU lost ground in the September election. But the election was viewed by the SPD as a disaster — it won barely one-fifth of the national vote, its worst result since 1949 — and the party, run by Martin Schulz, has categorically ruled out going into government again.

The pressure might now grow on it to change its mind, but it is unlikely to do so — although one senior SPD figure, Thomas Oppermann, said after the elections in September that a grand coalition would only work if Ms Merkel stepped down. In such a scenario, a key question would be who from the Christian Democrats the SPD might be prepared to work with.

The Social Democratic party, headed by Martin Schulz, has ruled out going into a coalition governmentCould a minority government work?Technically yes, although few parties like the idea. Thomas Kreuzer of the CSU, part of Ms Merkel’s conservative bloc and one of the negotiators in the coalition talks, said a minority government would lack the authority that Germany and the EU badly need at the present time.

Ms Merkel said on the night of the election that she would not favour such an option, and the SPD also made clear it would not “tolerate” a Merkel-led minority government. How could we get to new elections?The path to a new election is not straightforward, and first of all requires voting by the members of the Bundestag elected in September.Germany’s chancellor is not directly elected in a national vote.

Instead under Article 63 of Germany’s basic law the president nominates the chancellor, usually the candidate of the strongest group in parliament. He or she is then elected to office upon winning a majority of members of the Bundestag, the German parliament. All of Germany’s postwar chancellors attained office in this way, supported of course by having held successful coalition talks.

Now we are in a position where Ms Merkel cannot guarantee that support. In such a situation the constitution would require further votes. The first, within 14 days, would allow a candidate to become chancellor with a majority of votes in parliament. Failing that, a third vote would be held in which the candidate with the most votes could become chancellor. The president must then decide whether to appoint this person — potentially leaving them to try to run a minority government — or to dissolve the Bundestag.

What will happen if new elections are held?Many commentators say they could easily play into the hands of the Alternative for Germany (AfD), a rightwing populist party that won 13 per cent in the Bundestag election and has thrived on popular dissatisfaction with the established parties.

The breakdown of the coalition talks will vindicate the AfD’s claim that Germany’s political system is broken and needs radical solutions to fix it.The FDP, led by Christian Lindner, considers it has least to fear from new elections, and that it could pick up support from disgruntled conservative and AfD voters.

But some commentators have suggested that this could backfire against the FDP, which might be blamed by many voters for the breakdown of the “Jamaica” talks — so called because the parties’ colours match those of the Caribbean nation’s flag. Jürgen Trittin, a Green leader, said the FDP’s calculation could turn out to be a “cruel mistake”.

This is an illustration of what is wrong with schemes of proportional representation. Her previous coalition, which had an overwhelming majority -- something like 70% or more of the seats -- and now that coalition is in tatters, and the political future is uncertain.

In other words, there was a electoral tsunami last September which ran against her, and she's still in power. She wouldn't even have a problem if her coalition partner had remained loyal. It looks like she is going to have to step back and let someone else try to form a coalition.

If they used our system, the government would have been changed from top to bottom. And all the parties would know -- we gotta stop this Moslem immigration. Politically correct or not, they would know that.

German Chancellor Angela Merkel leaves the presidential residence Bellevue Castle in Berlin where she met the German President on Nov. 20, 2017 after coalition talks failed overnight.

ODD ANDERSEN/AFP/Getty Images

Paul Carrel and Gernot Heller

BERLIN

Reuters

3 hours ago

November 20, 2017

Chancellor Angela Merkel said she would prefer a new election to ruling with a minority after talks on forming a three-way coalition failed overnight, but Germany's president told parties they owed it to voters to try to form a government.

The major obstacle to a three-way deal was immigration, according to Merkel, who was forced into negotiations after bleeding support in the Sept. 24 election to the far right in a backlash at her 2015 decision to let in over 1 million migrants.

The failure of exploratory coalition talks involving her conservative bloc, the liberal pro-business Free Democrats (FDP) and environmentalist Greens raises the prospect of a new election and casts doubt about her future after 12 years in power.

Merkel, 63, said she was skeptical about ruling in a minority government, telling ARD television: "My point of view is that new elections would be the better path." Her plans did not include being chancellor in a minority government, she said after meeting President Frank-Walter Steinmeier.

Steinmeier said Germany was facing the worst governing crisis in the 68-year history of its post-World War Two democracy and pressed all parties in parliament "to serve our country" and try to form a government.

Merkel's role in doubt as German coalition talks fail (Reuters)

His remarks appeared aimed at the FDP and the Social Democrats (SPD), who on Monday ruled out renewing their "grand coalition" with the conservatives.

"Inside our country, but also outside, in particular in our European neighborhood, there would be concern and a lack of understanding if politicians in the biggest and economically strongest country (in Europe) did not live up to their responsibilities," read a statement from Steinmeier, a former foreign minister who has been thrust center-stage after taking on the usually largely ceremonial head of state role in March.

Steinmeier's intervention suggests he regards a new election - desired by half of Germany's voters according to a poll - as a last resort. The SPD has so far stuck to a pledge after heavy losses in the September election not to go back into a Merkel-led broad coalition of center-left and center-right.

Merkel urged the SPD to reconsider. "I would hope that they consider very intensively if they should take on the responsibility" of governing, she told broadcaster ZDF, adding she saw no reason to resign and her conservative bloc would enter any new election more unified than before.

"If new elections happened, then ... we have to accept that. I'm afraid of nothing," she said.

Business leaders also called for a swift return to talks.

With German leadership seen as crucial for a European Union grappling with governance reform and Britain's impending exit, FDP leader Christian Lindner's announcement that he was pulling out spooked investors and sent the euro falling in the morning.

Both the euro and European shares later recovered from early selling, while German bond yields steadied near 1-1/2 week lows, as confidence about the outlook for the euro zone economy helped investors brush off worries about the risk of Germany going to the polls again soon.

FEAR OF FAR-RIGHT GAINS

Earlier, Merkel got the strong backing of her CDU leadership.

Josef Joffe, publisher-editor of Germany weekly Die Zeit said she could rely on CDU support for now, but added: "I will not bet on her serving out her entire four-year term."

The main parties fear another election so soon would let the far-right, anti-immigrant Alternative for Germany (AfD) party add to the 13 percent of votes it secured in September, when it entered parliament for the first time. Polls suggest a repeat election would return a similarly fragmented parliament.

A poll published on Monday showed a new election would bring roughly the same result as the September election, with the Greens set to see the biggest gains.

If Germans voted next Sunday, Merkel's conservatives would get 31 percent, the SPD 21 percent, the Greens and the AfD both 12 percent, the FDP 10 percent and the Left party 9 percent, the Forsa survey for RTL television showed.

This compares with the election result of 32.9 percent for the conservatives, 20.5 percent for the SPD, 12.6 percent for AfD, 10.7 percent for FDP, 9.2 percent for the Left party and 8.9 percent for the Greens.

The failure of coalition talks is unprecedented in Germany's post-war history, and was likened by newsmagazine Der Spiegel to the shock election of U.S. President Donald Trump or Britain's referendum vote to leave the EU - moments when countries cast aside reputations for stability built up over decades.

Any outcome in Germany is, however, likely to be more consensus driven. "The problem is stagnation and immobility, not instability as in Italy," said Joffe.

The unraveling of the German talks came as a surprise since the main sticking points - immigration and climate policy - were not seen as FDP signature issues.

Responding to criticism from the Greens, FDP vice chairman Wolfgang Kubicki said a tie-up would have been short-lived. "Nothing would be worse than to get into a relationship about which we know that it will end in a dirty divorce," he said.

Even if the SPD or the FDP revisit their decisions, the price for either party to change its mind could be the departure of Merkel, who since 2005 has been a symbol of German stability, leading Europe through the euro zone crisis.

The inability to form a government caused disquiet elsewhere in Europe, not least because of the implications for the euro zone reforms championed by French President Emmanuel Macron.

Germany's political impasse could also complicate and potentially delay the Brexit negotiations - Britain has just over a year to strike a divorce deal with the EU ahead of an exit planned for March 29, 2019.

"It's not in our interests that the process freezes up," Macron told reporters in Paris, adding he had spoken with Merkel shortly after the failure of talks.

Good, this is what should happen. Not because she isn't conservative enough, but because she blew the immigration issue, and it's so important, the best thing for everybody is for her gang to turn the reins over to someone else.

This will be an election where the last results re-contextualize the political situation. Whether she realizes it or not, this is very likely the end of her chapter.

She had a long and successful career. In most of that time, she managed to find the 'sweet spot' of German politics, and was hugely popular, as politicians go. But the immigration decision was so wrong, and handled so badly that she should acknowledge that by retiring with honour.

I think she is doing the right thing in calling the election. She will likely suffer further losses. In a way it's sad, because she is certainly one of the great figures of European politics, ranking up there with statemen of the past. But this will fester and grow as long as it goes on.

The CDUs polling numbers are up slightly even in the wake of the collapse discussions;
But the two potential coalition partners are down or are static

The FDP was kicked to the curb in 2013 with zero seats and returned fairly strong in this post recent election with 80 seats, which leads me to believe that Christian Lindner isn't exactly aiming for a new election where his seat total will potentially decrease.

The CDU and Greens in theory are the two parties that would benefit the most from a new election and Merkel is certainly aware of that.

The second challenge is that there is limited alternative with none of the parties being willing to work with the AfD and their 94 seats and you need to get to 355 with the CDU holding 246 seats

You would require a SPD, FDP, Left, and Greens formed mega opposition coalition they would be @ 369 and I am not entirely sure the Left and the FDP could work together.

All roads to government likely lead through the CDU and Merkel is acting as such.

So, you say this is less a step to an election than a threat of what will happen if the minor parties don't support her? A way of putting their feet into the fire? It really sounds right.

It occurs to me that if you are right, she is offering her prospective coalition partners a way of surrendering under the assumption that not surrendering would be worse, because an election will be a setback for them. She's the rock, the other choice is the hard place.

I like it. It seems to fit. It might be one last shot at keeping the anti-immigrant people out. But I don't see how it stands a snowball's chance of working.

I still feel that Merkel should retire while she's at the top of her game. The German people don't want this. As long as it goes on, it will inflame the issue. That simple. Continued immigration at this scale, and from present sources, will encourage one side (at least) to become more radical, and the other more obdurate.

The time to compromise socially is now.

If she were not in the picture, everything would be more fluid. Her party could back down a bit, a process of compromise might set in. One or two rallies back and forth like that, and the complexion of things can change. Particularly if the immigration were limited and controlled.

There may be other ways it can work out, but the Germans have already been loaded up with racial guilt over Hitler, and stifle their national feelings for fear of rousing the ghosts of the past. 0K, but this is different There's no reason for Germans to take on racial guilt so far as the Arabs are concerned, never mind Somalis. Something has to snap.

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